On January 15, 2014, the company’s board of directors declared a 5% share dividend to the shareholders of record on January 20 to be distributed on January 30. The market prices of the shares on January 15, 20, and 30 were $12.00, $10.80, and $11.40, respectively.

Required1. Prepare the required entries for January 15, 20, and 30.2. Prepare the equity section on the January 31, 2014, balance sheet, assuming net income earned during January 2014 was $520,000.Analysis Component: What effect did the share dividend have on the market price of Arcus’s shares and why?